Ottawa urging Canadian food producers to explore global halal market

MONTREAL – A growing appetite for halal products around the globe
has prompted the Canadian government to encourage businesses to taste
the market for these foods.

Canada has so far failed to make much
of an impression in the international market for products that respect
Islamic dietary laws – also known as halal.

Yet Ottawa estimates the halal industry to be worth between US$500 billion and $2 trillion worldwide.

Now
government trade experts and industry insiders alike are warning
Canadian businesses they can ill afford to ignore the demographic
trends feeding increasing demand for halal and kosher products.

“There’s
a few people around the edges that think there is something here and,
without getting crazy, we’re trying to do some stuff,” said James
Hannah, a senior international market officer with Agriculture and
Agri-Food Canada.

“We think there is an opportunity and what
we’re trying to do is educate some of our companies,” he said while
adding there is some catching up to do. “It’s a question of just trying
to work along and try and get our act together at Agri-Food Canada.”

Canada
accounted for only $996 million of the $53 billion in global food
exports to the 19 major halal markets in 2006. Some fear the country’s
food producers risk being squeezed out of an increasingly crowded
market.

“For companies who want to benefit, the time is now,”
said Ehsan Sairally, co-ordinator of the Islamic Society of North
America’s halal-certification program.

“In the United States and
Dubai, people are moving very aggressively in marketing halal, but in
Canada we’re still a little bit slow.”

Many businesses that have shifted toward certified halal and kosher production processes have noticed the results.

Quebec-based
Ecolait Ltd., for example, has become one of North America’s leading
veal producers since it began producing halal meat in 2001. Its annual
sales now exceed $200 million, with 60 per cent of sales coming from
outside Canada.

Another Quebec-based company, pharmaceutical firm
Duchesnay, is hoping to mimic Ecolait’s success by being among the
first to develop a multivitamin supplement for pregnant women that is
both kosher and halal.

Duchesnay spent two years developing its
product after research showed a huge demand among religious minorities
for supplements that respect their religious dietary restrictions.

“I have to admit, it was harder than I thought,” said Duchesnay vice-president Eric Gervais.

The
development phase involved coming up with a way to make the supplements
without gelatin that is pork-based. But turning to certain types of
fish was out of the question as many are not considered kosher.

Duchesnay
would also have to reapply for certification if it changed suppliers
for any of the 27 active and inactive ingredients in the supplements.

“The risk is also quite large,” Gervais said.

But
if he is confident his company will recoup its investment, it’s not
because of the size of the Canadian market, which remains relatively
small.

“For us the return on investment is not only in offering
the supplements in Canada, it’s in exporting the expertise that we
developed in making these multivitamins abroad,” he said from the
company’s headquarters in Laval, north of Montreal.

With around
eight million Muslims in the United States and close to one million in
Canada, markets closer to home can be appealing to newcomers to the
business of supplying halal foods.

But for those eyeing the more
lucrative markets in the Middle East and Asia, Sairally advises
companies to do their homework first.

“It’s a different culture,
you don’t go over there and just get a $2-or $3-million contract,” he
said. “It doesn’t work this way. You have to understand the culture,
create friendships.”

Ultimately, halal foods are just part of an industry that includes everything from tourism to cosmetics.

“Canadian businesses need to get on the train,” Sairally said. “Because the train is leaving the station.”